If you rent a home or apartment, then your landlord should have insurance coverage on the building itself and any of his own belongings. But the landlord’s insurance policy will not cover your belongings as a renter. Any losses you suffer due to theft, flood or fire are your responsibility. You need renters insurance as a cost-effective way to protect your belongings.
What Is Covered?
An insurance policy for a renter covers many of the same things as a homeowner’s policy. Basically, your personal items are covered following theft, fire, water damage, and any other acts specified in the policy. Your policy might even pay for you to stay somewhere else while your apartment is repaired. This insurance can also offer protection against accidental damage you cause to someone else’s property.
You may want to consider liability coverage in case you are sued by someone for an injury sustained in your home. This is useful because a person’s medical bills could be astronomical. The last thing you want is to be sued and have no financial assistance.
It’s important to get an estimate on the value of your personal belongings. On average, most renters have at least $20,000 worth of belongings, and sometimes more. Take an inventory of your clothing, furniture, electronics, appliances, jewelry, artwork, etc. You can then choose between a ‘replacement value’ policy, which will pay you for brand new items if yours are damaged, or a ‘fair market value’ policy, which gives you a fair dollar amount for your used belongings when they are damaged or stolen.
Renters insurance is generally very low-cost. Some insurance carriers also offer discounts. You might have access to a multi-policy discount, a home-monitoring discount, a retired discount, or a claim-free discount. Ask about any available discounts before making a final decision.